Webcast — Condominium Buyer's Guide

 

Webcast — Condominium Buyer’s Guide

Are you thinking about buying a condo?

{VISUAL: Title appears on the screen: Canada Mortgage and Housing Corporation — Condominium Buyer’s Guide. A series of photographs fade in, showing a row of townhouses; high-rise and mid-rise residential buildings; a young woman carrying moving boxes; and an older couple sharing a smile while browsing on a laptop computer.}

Condominium living can be an appealing housing option. It’s often affordable and someone else handles much of the maintenance and repairs, such as shovelling snow and replacing the roof. However, purchasers should be aware — before they buy — of the many issues and considerations surrounding the purchase of, and the lifestyle in, a condominium.

The Condominium Buyer’s Guide helps you navigate through these issues and answers your questions.

{VISUAL: The photographs fade out and two new photos appear, of a smiling man leaning on a balcony railing, and a pair of hands holding a tablet computer with a screenshot of the Condominium Buyer’s Guide page of the CMHC website.}

{Text on screen: Introduction.}

This webcast will give you a brief overview of what is in the Condominium Buyer’s Guide and some basic information about condos. The Condominium Buyer’s Guide covers the ins and outs of buying a condominium, and provides both general information and answers to specific questions.

{VISUAL: The photograph of the tablet computer fades out, and the photo of the smiling man slides over to the right of the screen. A bullet list appears beside the photograph.}

{Text on screen: Introduction. Condo Basics: What do I own when I buy a condo? What are the rules and who makes them? How do I know if condo ownership is right for me? Who should I talk to before I buy? Checklists, Tips and FAQs. Provincial and Territorial Fact Sheets: What are the regulations in my area?}

This webcast will help answer some basic questions like

  • What do I own when I buy a condo?
  • What are the rules and who makes them?
  • How do I know if condo ownership is right for me?
  • Who should I talk to before I buy?

It will also direct you to the useful checklists, and provincial and territorial fact sheets that provide specific information about condominium legislation, requirements and regulations as well as contacts and resources.

{VISUAL: The bullet list fades out. A series of key questions and phrases appear on the screen.}

{Text on screen: Introduction. Did you know? What can you do? Buyer beware!}

Throughout the Guide, you will find helpful snippets of information flagged with “did you know,” “what can you do” and “buyer beware” that will alert you to key points. This webcast will go over some condo basics and what helpful information you can find in the Guide.

{VISUAL: The screen fades to white. A new bullet list fades in, along with photographs of mid-rise, high-rise and low-rise residential buildings.}

{Text on screen: What is a Condominium? Form of ownership, not a type of housing: Units in low-rise apartment buildings; Townhouses or rowhouse complexes; Duplexes or triplexes; Single-detached houses; Vacant land upon which owners may build.}

The first question you might have is — what is a condominium anyway? A “condominium” refers to a form of legal ownership, as opposed to a style of construction. Condominiums are often thought of as units in high-rise residential buildings, but they can instead be:

  • Units in low-rise apartment buildings (fewer than four storeys);
  • Townhouses or rowhouse complexes;
  • Duplexes or triplexes;
  • Single-detached houses; or
  • Vacant land upon which owners may build.

Condominiums, with a variety of sizes and diverse features, can be found in almost every price range.

{VISUAL: The photographs and bullet list fade out, and are replaced by a new bullet list and a picture of a potted plant sitting on the floor of an empty room.}

{Text on screen: Condos — Three Choices. New Condos: Not previously occupied. Resale Condos: Previously occupied. Conversion Condos: Existing building converted from non-condominium residential rental or non-residential use.}

When you are looking to buy a condominium, you have three choices: buying a new condo, a resale condo or a conversion condo.

{VISUAL: The photograph of the plant fades out, and is replaced by a photo of a high-rise condominium building under construction.}

“New condominiums” are units that have not been previously occupied. They can be in the planning stage, under construction or recently completed, and are usually purchased from a developer. For many buyers, they’re an attractive option because of their fresh appearance and modern fittings, surfaces and appliances. They also often give purchasers the chance to customize their units.

{VISUAL: The photograph of the building fades out, and is replaced by a photo of a traditionally-styled living room.}

“Resale condominiums” are units that have already been occupied, typically in older buildings, and are being sold by the current owner. One of the advantages of purchasing an existing condominium is that you get to see the unit, building and grounds before you make your purchase. You also have the opportunity to meet other unit owners, speak with a representative of the Board of Directors of the condominium corporation, and ask questions of the property manager.

{VISUAL: The photograph of the living room fades out, and is replaced by a photo of an empty, loft-style converted living space.}

“Conversion condominiums” are units in a building that was previously used for something else but has been, or is to be, renovated for residential use. For example, many loft-style condos are converted from former commercial or industrial buildings. Conversions can also refer to the switching of units from non-condominium rental units to condo units.

The Condominium Buyer’s Guide can help answer your questions about each of these types of condos.

{VISUAL: The bullet list and photograph fade out, and the screen fades to a new bullet list, with photos of a modern, open-concept high-rise condominium apartment, and the front driveway and exterior of a low-rise condo building.}

{Text on screen: What Do You Own? It is important to find out what your Condo includes: A private living space (unit) — Interior only, Exterior walls, roof; The unit and the land; Common elements — are they for shared use or private use.}

Another question you might have when you are looking to purchase a condo is: What do you actually own when you purchase a condominium? What fees or costs will I have to pay?

Knowing what you actually own is pretty important. In order to compare different condo choices and costs, you will want to be clear on what costs are your responsibility and what costs are the responsibility of the condo corporation.

You’ll want to know, for instance, whether you’ll be arranging for window washing or repairs to your townhouse’s bricks, or whether the condominium corporation will be responsible for this. Some condominium units, called freehold condominiums, include ownership of the land your home is on. If this is the case, your unit may be the entire house including the exterior walls, the roof and the lawn.

{VISUAL: The photographs fade out, and are replaced by photos of the interior hallway and elevator of a residential building, and the parking area of a large mid-rise condominium community.}

Common elements may include lobbies, hallways, elevators, recreational facilities, walkways, gardens and other amenities. They may also include structural elements and mechanical and electrical services.

Some common elements, although outside the unit boundaries, are still for the sole use of the owner of a particular unit. Balconies, parking spaces, storage lockers, driveways and lawns are common examples.

{VISUAL: The bullet list and photographs fade out, and the screen fades to a new bullet list, with a photo of a young couple using a calculator to work out their budget.}

{Text on screen: What Will You Pay? Fees and additional costs beyond your mortgage payment; Monthly fees typically cover: Upkeep of common areas; Condo corporation’s insurance; Utilities and services; Reserve fund contributions.}

Equally important as the question of what do you own is the question of what will you pay to own the condo. Fees and additional costs beyond your mortgage payment are an important part of your decision to purchase. You need to know what your total costs will be in order to plan your budget.

In addition to paying for your unit and a proportionate share of the common property, you will also pay monthly condominium fees, along with all of the other unit owners. These cover the upkeep of common elements — whether you use them or not. The fees may also cover the condo corporation’s insurance policies, utilities, and services such as snow removal and garbage pick-up. Part of the monthly fees may be put into a reserve fund to cover the estimated cost of future major repairs and replacements.

One question you may want to ask is how often are condo fees adjusted, so you can be prepared to budget accordingly.

{VISUAL: The bullet list and photograph fade out, and the screen fades to a new bullet list, with a photo of a computer screen showing the Home Page of the CMHC website.}

{Text on screen: What Can I Afford? Did you know?: Costs should be in agreement of purchase and sale. What can I afford?: Homebuying Step by Step — Online Calculator: cmhc.ca/homebuying}

Once you find out how much and what is included in the condo, you can compare costs between condo options and plan for your monthly expenses. It’s important to know how much money you should set aside to purchase — and live in — a condominium. This includes the purchase price and the monthly fees. All of this information should be in the Agreement of Purchase and Sale.

{VISUAL: The screenshot on the image of the computer screen changes to the Homebuying Step-by-Step landing page of the CMHC website.}

Your bank, mortgage broker or financial advisor can help tailor your mortgage to suit your specific financial goals and needs. There are many different types of mortgages, including conventional, high ratio and second mortgages. Take the time to discuss your current financial position and future goals with your financial advisor and be sure that you are comfortable with your purchase. CMHC’s online guide, Homebuying Step-by-Step, can also help you to determine what you can afford.

{VISUAL: The bullet list and photograph fade out, and the screen fades to a new bullet list, with a photo of a middle-aged couple discussing their options with an advisor.}

{Text on screen: What Are the Rules? Typically govern day-to-day concerns of condo living: Maximum number of occupants; Pets, noise, parking; Access to facilities; Appearance and/or alteration of unit.}

Understanding the rules and restrictions of the condo before you buy is critical. Rules focus on day-to-day concerns of condominium living and vary from condo to condo. They may be very strict or very relaxed depending on the nature of the corporation, but they help ensure that the condominium is a safe, pleasant and attractive place to live. Rules also spell out what your rights and obligations are as an individual owner. Rules frequently cover:

  • The maximum number of occupants per unit;
  • Pets;
  • Noise;
  • Parking;
  • When you may use certain amenities, such as the pool or exercise room; and
  • The appearance and/or alteration of the unit.

Prospective buyers should carefully review and consider all rules and obligations prior to purchasing a unit. You can get a copy of the rules from the seller, the property manager or the Board of Directors.

{VISUAL: The photograph of the couple fades out, and is replaced by a screenshot of the Ontario Fact Sheet from the CMHC Condominium Buyer’s Guide.}

The Provincial and Territorial Fact Sheets in the Guide can help you understand the regulations governing the protocol for condominiums in your jurisdiction. Here’s a tip: ask the current residents if they have any issues, and how they’ve been dealt with in the past. This will give you a good sense of how the condo corporation and its Board are working.

{VISUAL: The bullet list and fact sheet fade out, and the screen fades to a new bullet list, with a photograph of a group of people talking at a condominium General Meeting.}

{Text on screen: What’s My Role?: Attending general meetings and information sessions; Serving on the board of directors or on a committee; Voting.}

Buying a condominium brings a different set of responsibilities than homeownership, and the Condominium Buyer’s Guide can help explain these. For example, when you become a condo owner, you become a member of a condominium corporation.

As an owner, it’s your responsibility to participate in the governing of the condominium. You can do this by attending general meetings and information sessions, serving on the Board of Directors or on a committee, and voting. It’s also important to read the minutes of meetings and other information sent to members, such as the condo newsletter, as well as the corporation’s budget and financial statements.

While the Board of Directors makes many decisions for the condominium, certain decisions, particularly those with a significant financial impact, must be made by unit owners. Some condominiums run more smoothly than others, so it is always a good idea to talk to people on the Board of the condo before you buy.

{VISUAL: The bullet list and photograph fade out, and the screen fades to a new bullet list, with a screenshot from the Condominium Buyer’s Guide. A pop-up window highlights “Chapter 3: The Pros and Cons of Condominium Ownership.”}

{Text on screen: Is a Condo the Right Choice For You? Checklist of Pros: Fewer maintenance and repair responsibilities; Access to convenient on-site amenities; Enhanced security features; Predictable monthly fees; Have a say in the running of the condominium corporation; A community that may have a wide range of activities.}

Is a condo the right choice for you?

The Condominium Buyer’s Guide can help. The Guide has a list of questions that you should ask yourself to weigh the pros and cons of condo living. For example, some of the pros compared to traditional homeownership are:

  • Fewer maintenance and repair responsibilities;
  • Access to convenient on-site amenities, such as a sauna or swimming pool;
  • Enhanced security features in some condominiums;
  • Predictable monthly maintenance or condo fees;
  • Plus you’ll have a say in the running of the condominium corporation as an owner or Board member;
  • Also, you’re joining a community that may have a wide range of social, entertainment and recreational activities.

{VISUAL: The bullet list of Pros fades out, and is replaced by a new bullet list of Cons.}

{Text on screen: Is a Condo the Right Choice For You? Checklist of Cons: May not be able to decide when maintenance and repairs get done; May have to pay for amenities that you might never use; Less privacy and possibly more noise; Charges for unexpected repairs; Attracts individuals with a variety of personalities; Less space in some condominium units; Restrictions on things like noise levels.}

On the other hand, some of the cons of owning a condo include:

  • You may not be able to decide when maintenance and repairs get done;
  • You may have to pay for amenities that you might never or rarely use;
  • Less privacy in some condominium units and possibly more noise;
  • Possibility of special assessment charges for unexpected repairs;
  • Like most communities, a condominium attracts individuals with a variety of personalities. It can sometimes be a challenge to reach a consensus;
  • Less space in some condominium units;
  • Possible restrictions on things like noise levels, parking, pets, smoking, and even the style and colour of features such as doors and window coverings.

Go through all of the questions in the online checklist. If you answer “yes” to most of them, then buying a condo may be a smart move for you. If not, then you may want to reconsider.

{VISUAL: The bullet list and screenshot fade out, and the screen fades to a new bullet list, with the image of a desktop computer showing a screenshot of the front cover of the Condominium Buyer’s Guide.}

{Text on screen: The Condo Buyers Guide Has Answers…: Tips for Buying a New or Resale Condo; Checklist for Buying a New or Resale Condo; Condominium Purchase and Recurring Costs; Questions to Ask Advisors and Condominium Experts; Frequently Asked Questions; Glossary; Provincial/Territorial Fact Sheets.}

Once you’ve decided that a condo is right for you, you may be asking: Should I buy new or resale? What can I afford? And who can I talk to? You should be able to find answers to most of your questions using these resources from the Condominium Buyer’s Guide:

  • Tips for Buying a New or Resale Condo;
  • Checklist for Buying a New or Resale Condo;
  • Condominium Purchase and Recurring Costs;
  • Questions to Ask Advisors and Condominium Experts;
  • Frequently Asked Questions;
  • Glossary; and
  • Provincial/Territorial Fact Sheets.

{VISUAL: The image of the desktop computer fades out, and is replaced by a shaded screenshot from the Provincial and Territorial Fact Sheets section of the Condominium Buyer’s Guide. A three-dimensional map of Canada is superimposed over the screenshot.}

Condominiums across Canada have many similarities, and are generally run along the same principles. For example, condos in all provinces and territories are corporations whose units are privately owned and whose common elements, such as elevators and hallways, are owned by all of the condo members. But there are differences.

To assist you in understanding what the condo regulations are in your area, CMHC has created a Fact Sheet for each province and territory in Canada. They cover legislation, warranty programs, taxes and costs, reserve fund requirements, governance and other issues. These fact sheets can help you to find the right information that is specific to your location, as well as local contacts.

{VISUAL: The bullet list, map and screenshot fade out, and the screen fades back to the image of a pair of hands holding a tablet computer with a screenshot from the Condominium Buyer’s Guide page of the CMHC website.}

{Text on screen: Thank-You. Condo Buyers’ Guide: cmhc.ca/condoguide}

Whether you are a first-time or repeat home buyer, the CMHC Condominium Buyer’s Guide has a lot of information that can help you in taking the next step toward making the right home purchase. Visit cmhc.ca/condoguide

{VISUAL: The screen fades to white. The bilingual CMHC logo and “Home to Canadians” tagline appear on the screen.}

{Text on screen: The information in this publication is a result of current research and knowledge. It is not intended for the content to be relied upon as professional or expert advice or opinions. Readers should evaluate the information, materials and techniques cautiously for themselves and consult appropriate professional resources to see if the information, materials and techniques apply to them. The images and text are guides only. Project and site-specific factors (climate, cost, aesthetics) must also be considered.}

{VISUAL: The screen fades to white as the Canada Wordmark fades in. The Canada Wordmark fades out, and the icons for Flickr, Twitter and YouTube appear on the screen, along with the CMHC website address: cmhc.ca}

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